House Bill 142 would require North Carolina to move to zero-based budgeting for the state budget, with implementation beginning in the 2027-2028 fiscal year and a full statewide zero-based budget in place for the 2031-2033 biennium. Under the bill, a zero-based budget means each agency must justify its funding from the ground up, rather than relying on prior-year appropriations as the starting point. The measure directs the Governor to establish a four-year phase-in schedule, beginning with executive branch agencies, and to identify which agencies must submit zero-based budgets in each year of the transition.
The bill also amends the Governor’s budget submission requirements so that, starting in 2027-2028, budget recommendations to the General Assembly must include zero-based budgets for the agencies selected under the phase-in plan. By 2031-2032, the entire state budget for the 2031-2033 biennium would be required to use the zero-based format. The bill is effective upon becoming law and would change the budgeting process rather than alter program eligibility, tax rates, or direct services.
HB142 would amend Chapter 143C of the North Carolina General Statutes to create a new statutory framework for zero-based budgeting and to require the Governor’s budget recommendations to incorporate that approach on a phased timeline. Its practical effect would be to increase the documentation and justification required from state agencies when requesting appropriations, potentially affecting how executive agencies prepare budgets and how the General Assembly reviews spending proposals. The bill would not itself appropriate funds, but it would change the method used to develop future state budgets and could influence agency funding levels, administrative workload, and budget negotiations across state government.
Based on the bill text and available procedural history, the measure appears to be a policy-driven reform with no recorded floor vote or committee transcript indicating strong public opposition or support. The bill was introduced with multiple sponsors and referred through the normal committee process, then re-referred to Appropriations, suggesting it was treated as a substantive budget-process proposal. Overall, the available record suggests a generally favorable or at least serious legislative interest in exploring zero-based budgeting, though no direct debate is available in the provided materials.
The main point of contention is likely to be the feasibility and administrative burden of requiring agencies to justify budgets from zero, especially across the entire state budget. Supporters would likely view the bill as a tool for improving fiscal discipline, transparency, and cost-effectiveness, while opponents may argue that it is time-consuming, resource-intensive, and difficult to apply consistently across large agencies and complex programs. Another likely issue is the phased implementation schedule: some may favor the gradual rollout, while others may question whether the timeline is too ambitious or too slow to produce meaningful savings.